HMRC launch 'Special Relief' to replace the previous 'Equitable
Liability'...
For those self-employed individuals who very often feel down
trodden with self-employed life and feel they just don't get a
break, may be pleased with the new 'special relief' introduced by
HMRC and was effective from the 1st April 2011.
If you have ever been (or may be in future) in a position where
you have received an income tax or corporation tax determination(s)
and your tax affairs are in arrears, you may be entitled to this
special relief - special relief applies to tax debts that may be
legally due, but that are considered to be (after investigation)
extreme and unfair.
Special relief has replaced 'Equitable Liability' where
basically "customers had no statutory remedy to adjust an
excessive assessment or displace a determination because the time
limit for submitting a return had passed". The commonly aided
were for example, the elderly or perhaps vulnerable individuals and
self-employed where illness or bereavement played a major factor to
them subsequently missing the notice to appeal. In some cases, HMRC
considered not to pursue matters or recover the full amount due -
how very noble of them you may be thinking - well, they only did so
where certain criteria had been met and the concession was
obviously dependent on individual circumstances and each particular
case.
Equitable Liability began life in August 1995 and has been in
need of modernisation hence the new special relief. Special
relief, (as with equitable liability) will only apply where there
are simply no more avenues of appeal however there are certain
conditions that have to be met before the tax due can be
assessed.
So what exactly is 'special relief'? Well, HMRC have
published full and detailed information about special relief here
but in simple terms, when you receive a notice to submit your
return, you obviously have a deadline in which to do so - a 'filing
date'. If you fail to submit your return by this date, HMRC
are entitled to issue a determination which basically confirms the
amount due to them (and currently unpaid). You cannot appeal
against this. You do have a grace period in which to send in
your return, and if you do so, the determination will be
displaced. If, on the other hand, you do not submit your
return by the time limits allowed, you may be able to claim special
relief. Again, full details of how you claim along with the
conditions can be found on HMRC's website here.
If you feel you may be eligible for tax relief and would like
some advice, please do not hesitate to contact us. You should
however note that if you have had full control of your affairs for
the period in question, it is extremely unlikely that any relief
will be provided but if you have not, this may be your break!